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Los Angeles investment firm buys Valpak direct mail business

 
St. Petersburg-based Valpak, one of the nation's largest direct mail companies, has been acquired by a California billionaire.
[Company handout photo]
St. Petersburg-based Valpak, one of the nation's largest direct mail companies, has been acquired by a California billionaire. [Company handout photo]
Published Jan. 4, 2017

St. Petersburg-based Valpak, one of the nation's largest direct mail companies, has been acquired by a California billionaire who is the owner of the NBA's Detroit Pistons.

Tom Gores' global investment firm, Platinum Equity, announced Tuesday that it had acquired the businesses of Cox Target Media, Valpak's parent company, in a deal whose terms were not released.

Gores, 52, of Beverly Hills, Calif., who founded Platinum in 1995 and is its chairman and CEO, has a net worth estimated at $3.3 billion and is ranked 194th on the Forbes' list of the wealthiest Americans. He bought the Detroit Pistons in 2011.

Valpak, best known for the ubiquitous blue envelopes stuffed with coupons mailed to millions of consumers, operates a $220-million printing facility visible from Interstate 275. Platinum said Cox Target Media reaches 100 million consumers, primarily through the blue envelope mailers and via the website Savings.com.

Platinum said in a news release that both Valpak and Savings.com, which it also acquired, will continue to operate under their brand names with no changes in its workforce. Valpak spokeswoman Samantha Rego said the company, which employs 700, plans to eventually add jobs.

"It will be business as usual," Rego said.

Valpak president Mike Vivio could not be reached for comment.

Valpak was founded in 1968 in a rags-to-riches story that turned an unemployed forklift operator into an advertising pioneer.

The forklift driver, Terry Loebel, was looking for a way to support his family, scrounging for money by working as an exterminator and collecting soda bottles. Then he got an idea. He persuaded local merchants to invest in coupons he would mail to thousands of potential customers. If the ads didn't work, he would refund their money.

Loebel started his business with a $500 loan from a friend.

His company, Valpak, would eventually mail 20 billion coupons a year and allow Loebel to retire a wealthy man. He died in 2012 at age 71, long after he sold Valpak to a group of investors in 1985. That group, in turn, later sold it to the media conglomerate Cox Enterprises, now Cox Media Group.

Cox officials declined to say why they decided to sell the business, saying only that Valpak and Savings.com were not the right fit for Cox.

Gores' (pronounced GORE-es) wealth, like Loebel's, is self-made, and his business career started with a detour to a casino.

After earning a degree in construction management from Michigan State University, Gores and his girlfriend decided to move to California to take a job with a software company. They stopped at Las Vegas on the drive west, where the couple lost most of their money at the blackjack table, according to a 2011 Hour Detroit magazine profile of Gores.

They got back in the car. Right before the California state line, Gores stopped at another casino and went to the blackjack table with what little cash he had left.

This time, the magazine said, he walked away with $4,000.

Contact William R. Levesque at levesque@tampabay.com. Follow @Times_Levesque.